Home Business ICICI Bank, Axis Bank buy stake in Indian Oil's joint venture refinery

ICICI Bank, Axis Bank buy stake in Indian Oil’s joint venture refinery

Indian Oil and Chennai Petroleum will hold 25 per cent each in the joint venture. (Representative)

New Delhi:

Chennai Petroleum shares today saw sharp buying after private sector lenders ICICI Bank and Axis Bank said they picked up stake in the proposed joint venture between Indian Oil Corporation and Chennai Petroleum Corporation.

Indian Oil Corporation also took good buying support.

In a regulatory filing with BSE, ICICI Bank said that the joint venture will be incorporated through an initial capital of Rs 5 lakh. ICICI Bank will contribute 10 per cent of the total paid-up capital of the JV at a cost of Rs 50,000.

The joint venture is proposed to be incorporated through a seed capital of Rs 5 lakh.

“ICICI Bank as a seed equity investor has no obligation to fund the future equity requirement of the project beyond the initial seed capital contribution of Rs 50,000,” the filing said.

Indian Oil and Chennai Petroleum will each hold 25 per cent stake in the joint venture that will implement the 9-MMTPA refinery at Nagapattinam in Tamil Nadu.

In a similar filing with BSE, Axis Bank said it will acquire 10 per cent stake of the proposed joint venture at a cost of Rs 50,000.

The insurance arm of ICICI group ICICI, Prudential Life Insurance also informed the stock exchanges that it will pick up 9 per cent stake at a cost of Rs 45,000.

Shares of Indian Oil and Chennai Petroleum rose on the participation of private sector players as seed investors.

Indian Oil closed at Rs 72.05, up over 3 per cent, on the BSE, while Chennai Petroleum was up 3.76 per cent at Rs 198.70. Chennai Petroleum rose over 5 per cent intraday.

Shares of ICICI Bank, Axis Bank and ICICI Prudential also gained 0-1 per cent.

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